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TonyTax
TonyTax, Tax Consultant
Category: Tax
Satisfied Customers: 15950
Experience:  Inc Tax, CGT, Corp Tax, IHT, VAT.
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PLEASE COULD YOU TELL ME HOW MUCH TAX WOULD BE PAYABLE ON A

Customer Question

PLEASE COULD YOU TELL ME HOW MUCH TAX WOULD BE PAYABLE ON A 9.85% Bond ?
Submitted: 2 years ago.
Category: Tax
Expert:  TonyTax replied 2 years ago.
Hi. Are you a basic rate or a higher rate taxpayer? Is tax deducted from the interest at source by the payer? What is the nominal value of the bond, how much did you invest? What type of bond is it?
Customer: replied 2 years ago.

Hello Tony Tax,

Thank you for your swift response. You can view the Bond without having to be a member @ www.eliteinvestorclub.com It says that it is ISA compliant and so returns can be taken tax free.

Is there a limit to the number that my husband and I could buy ? What would that limit be please ? At the moment my husband is working and we are higher tax payers. When he retires we will be basic tax payers so we would like both figures please ?

Thank you very much for your expertise, time and attention.

Expert:  TonyTax replied 2 years ago.
Thanks.

Let me take a look and I'll get back to you.
Expert:  TonyTax replied 2 years ago.

Hi again.

If you invested £1,000 in the 9.85% Bond outside of an ISA, you would get £98.50 in gross interest.

A 20% taxpayer would pay £19.70 in income tax, leaving them with £78.80, a net return of 7.88%.

A 40% taxpayer would pay £39.40 in income tax, leaving then with £59.10, a net retrun of 5.91%.

The Elite Investor Club will probably have a maximum investment limit and you can find out what that is by completing the enquiry form here:

http://www.eliteinvestorclub.com/portfolio/9-85-bond-with-95-capital-guarantee/

If you invested through an ISA, the interest would be completely free of income tax so your net return would be 9.85%. The limits for ISAs can be found here:

https://www.gov.uk/individual-savings-accounts/overview

There are set up charges so for the 9.85% Bond and those would dilute the year 1 return somewhat.

I hope this helps but let me know if you have any more questions.

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